Payment of social contributions for employees
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Any person engaging in a professional activity must, in principle, be registered with the social security services in order to benefit from social security coverage in the event of illness, unemployment, occupational accidents, pension, etc.
To this end, all employers must submit a monthly declaration of the gross salaries paid to their employees, and the exact number of hours worked, to the Joint Social Security Centre (Centre commun de la sécurité sociale - CCSS).
Every month, based on these salaries, the CCSS calculates the amount of social contributions due for each employee, and informs the employer of the total amount of social contributions to be paid. This amount includes both the employees' share of the social contributions and the employer's share of the social contributions.
The social contributions owed by employees are directly deducted from their wages by the employer, who is responsible for paying the entire social-contributions bill in settlement of the monthly invoice received from the CCSS.
Who is concerned
The following are involved in the payment of social contributions:
- the employer, who must pay social contributions to the CCSS;
- if applicable, payroll experts (fiduciaries, etc.) appointed by the employer.
Prerequisites
When social contributions are paid, it is assumed that:
- there is an employment contract between the employer and the employee;
- the employer has registered their business with the social security services (in order to be able to take on employees);
- the employer has declared the hiring of the employee with social security;
- the employer has declared the gross monthly salaries paid to employees for the month just ended, to the CCSS.
How to proceed
Applicable contribution rates
The CCSS informs the employer, by post, of the applicable rates and of any changes.
Distribution of the contributions burden between the employer and employee
When calculating the employee's salary, the employer withholds the employee's share of the contributions from their gross monthly salary.
| Employee's share | Employer's share | |
|---|---|---|
| Health insurance (as at 1 November 2015) | Benefits in cash: 0.25 % Benefits in kind: 2.80 % |
Benefits in cash: 0.25 % Benefits in kind: 2.80 % |
| Pension insurance | 8.00 % | 8.00 % |
| Long-term care insurance | 1.40 % | - |
| Accident insurance | - | 0.75 % |
| Occupational health (STM) | - | 0.14 % |
| Mutual insurance scheme | - | depends on the contribution class to which the business belongs |
The monthly contribution base cannot be less than the social minimum wage for non-qualified workers aged 18 and over or, where applicable, than the social minimum wage applicable to adolescent workers.
In principle, the monthly contribution base cannot be more than 5 times the social minimum wage for non-qualified workers aged 18 and over.
Accident insurance
The CCSS automatically informs the Accident Insurance Association (Association d'assurance accident - AAA) whenever a new employer registers with the social security.
Accident insurance contributions are borne entirely by the employer.
Employers' mutual insurance scheme
All businesses must join the Employers' mutual insurance scheme (Mutualité des employeurs - MDE). This mutual insurance scheme is largely financed by a contribution borne by employers. MDE registrations are managed by the CCSS, which also collects MDE contributions.
Businesses are divided into 4 contribution classes based on the 'financial absenteeism' rate among their employees during the previous year.
| Financial absenteeism rate = | Amounts reimbursed to a business for cases of incapacity to work (of employees and self-employed workers) |
|---|---|
| Contribution base (for employees and self-employed workers) |
The following are not taken into account in the calculation:
- incapacity to work due to illness during the trial period, up to a maximum of 3 months;
- incapacity to work due to accidents in the workplace or occupational illness;
- absences for maternity or adoption leave;
- absences for leave for family reasons;
- absences for family hospice-care leave.
| Contribution class | Absenteeism rate | Contribution rate |
|---|---|---|
| Class I | < 0.65 % | 0.72 % |
| Class II | < 1.60 % | 1.22 % |
| Class III | < 2.50 % | 1.46 % |
| Class IV | > 2.50 % | 2.84 % |
Each month, the CCSS calculates the total monthly social contributions bill, based on the gross monthly salaries declared by the employer on the list of salaries. They then send the employer an account statement before the 15th of the month showing the total amount of social contributions to be paid (employer's and employees' contributions).
Paying social contributions
CCSS account statement
The account statement is always divided into 3 distinct parts:
'Debit' part
The following items, in particular, may appear in this part:
- the debit balance from the previous statement;
- a breakdown of the contributions by social security institution for the month in question (month M);
- any potential adjustments to contributions made for the period prior to month M;
- any outstanding interest on late payments;
- fines, if applicable.
'Credit' part
The following items, in particular, may appear in this part:
- the credit balance from the previous statement;
- the sum of the payment or cumulative payments made since the previous statement;
- any reimbursement of contributions or payment reversals;
- credit transfers from one account to another.
'Balance' part
The overall balance, corresponding to the total amount of social contributions to be paid, appears at the bottom of the account statement and is arrived by calculating the sum of the items in the 'debit' and 'credit' parts.
Payment
The employer must settle the balance shown in the CCSS's monthly invoice within 10 days of the date of issue of the CCSS contributions statement. This deadline must be respected in all circumstances, even if the employer wishes to make a claim in connection with the calculation of the social contributions.
Valid claims will give rise to a subsequent adjustment.
For the CCSS to be able to correctly record their payments, the employer must:
- specify their registration number on the transfer or payment order;
- pay the amount on each account statement separately, if employees are registered under different employer registration numbers.
Furthermore, the employer may simplify the payment transactions by authorising the CCSS to collect direct-debit payments.
Contributions which are unpaid on or after the due date will bear late-payment interest starting from the first day of the first month after the contribution deadline. The interest rate on late payments is set at 0.6 % per whole calendar month; fractions of months are disregarded.
Enforced collection of contributions
The CCSS will invariably initiate enforced collection when 4 months of contribution arrears are accrued.
The enforced collection procedure starts with a formal demand for payment, sent to the debtor by registered letter, directing them to:
- either pay the outstanding contributions within 15 days of receipt of the registered letter;
- or accept the payment deadline proposed by the CCSS.
The employer can apply for a longer deadline than is offered. However, deadline extensions will only be granted on an exceptional basis.
Late payers who have been granted an extension of the payment deadline are still required to pay the current contributions, including late payment interest at an annual rate of 7.2 %.
Where the debtor does not meet the new payment deadline, or has not accepted the proposed payment deadline, the CCSS will initiate enforced collection of contributions by administrative order, notified to the debtor by registered letter. A bailiff will enforce the order. If the bailiff cannot enforce collection due to a lack of funds, the CCSS will refer the case to a lawyer and begin bankruptcy proceedings against the debtor.
Online services and forms
Who to contact
-
Joint Social Security Centre (CCSS)
- Address:
-
4, rue Mercier
L-2144
Luxembourg
Luxembourg
L-2975 Luxembourg
- Phone:
- (+352) 40 14 11
- Email address:
- ccss@secu.lu
- Website:
- https://ccss.public.lu/fr.html
Open Closes at 16.00
- Thursday:
- 8.00 to 16.00
- Friday:
- 8.00 to 16.00
- Saturday:
- Closed
- Sunday:
- Closed
- Monday:
- 8.00 to 16.00
- Tuesday:
- 8.00 to 16.00
- Wednesday:
- 8.00 to 16.00
The reception desks can only be visited by appointment.
Related procedures and links
Procedures
Links
Legal references
- Code de la sécurité sociale
-
Règlement grand-ducal du 16 décembre 2022
portant abrogation du règlement grand-ducal du 28 janvier 1987 concernant la perception des cotisations de sécurité sociale par le Centre d’informatique, d’affiliation et de perception des cotisations
-
Loi modifiée du 13 mai 2008
portant introduction d'un statut unique pour les salariés du secteur privé
-
Loi du 17 décembre 2010
portant introduction d'un taux de cotisation unique dans l'assurance accident
-
Loi du 17 décembre 2010
portant introduction des mesures fiscales relatives à la crise financière et économique
- Mutualité des employeurs – Statuts
